lecture2 notes

These numbers could be just monetary payos or it

Info iconThis preview shows page 1. Sign up to view the full content.

View Full Document Right Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: ains a pair, (a, b ) where a = u1 (x , y ) and b = u2 (x , y ). These numbers could be just monetary payoffs, or it could be inclusive of “social preferences” (the fact that you may be altruistic towards your partner or angry at him or her). Should you play “work hard” or “shirk”? 8 Game Theory: Lecture 2 Strategic Form Games Strategic Form Games Let us start with games in which all of the participants act simultaneously and without knowledge of other players’ actions. Such games are referred to as strategic form games—or as normal form games or matrix games. For each game, we have to define 1 2 3 The set of players. The strategies. The payoffs. More generally, we also have to define the game form, which captures the order of play (e.g., in chess) and information sets (e.g., in asymmetric information or incomplete information situations). But in strategic form games, play is simultaneous, so no need for this additional information. 9 Game Theory: Lecture 2 Strategic Form Games Strategic Form Games (continued) More formally: Definition (Strategic Form Game) A strategic fo...
View Full Document

Ask a homework question - tutors are online